Across the nation, faith-based services are reporting drops in donations and cutbacks on government funding while demand has dramatically increased.

Local and state governments, struggling themselves with mounting debts, have reduced contracts and grants or have been late in payments, reported many faith-based groups.

Under such circumstances, organizations sometimes turn to banks to borrow funds to cover the immediate needs until the government can make the next payment. But given the state of the economy, it is difficult to procure a bank loan nowadays.

This situation has forced many faith-based groups to cut programs, lay off staff and turn needy Americans away.

“Our folks out in the field are feeling a little overwhelmed because they can't see the end, and all they see are more and more people coming and fewer resources coming their way,” shared Larry Snyder, chief executive of Catholic Charities USA, which receives about 65 percent of its income from government contracts, to The Washington Post.

"And yet we don't have the luxury to say, 'You know what? We're going to close our doors for a while,'" he said.

Washington-area based Jewish Social Service Agency, which gets half of its revenue from the government, reported that while its private donations have dropped nearly 10 percent, its client list has grown 35 percent.

Meanwhile in Illinois, the state government reportedly owes the Lutheran Social Services of Illinois more than $4 million for contract services, according to the Lutheran Service in America.

The Lutheran Social Service in Minnesota, meanwhile, says that the number of families requesting its foreclosure counseling service has grown five-fold in three years – from 3,000 families in 2005 to 18,000 in 2008, according to the Evangelical Lutheran Church in America news service.

But despite the huge obstacles, faith-based groups continue to strive to serve Americans struggling in the recession.

Feed The Children, a Christian relief organization that ranks among the top 10 largest international charities in the United States, recently helped deliver much-needed food and personal care items to 4,400 families in an area heavily affected by the economic crisis.

A DHL Express plant in Wilmington, Ohio, was closed, leaving thousands of locals without a job. According to the Economic Task Force for the DHL Hub created by Major David Raizk, one in three families in Wilmington had someone employed at DHL.

“I have been touched by the devastation that these families are feeling. There may be no city in America that has been impacted by the current economic crisis as much as Wilmington,” said Larry Jones, founder and president of Feed The Children, in a statement. “With this delivery, Wilmington families can walk away from this event with renewed hope knowing that someone is there to help them weather this storm.”

Crowds of people gathered last Thursday to receive two boxes of supplies per family that included 25 pounds of canned food and vegetables and 10 pounds of personal care items, according to CNN. The boxes are designed to sustain a family of four for up to 10 to 14 days.

"A lot of [these] people in this town ... it's day to day, dollar to dollar," said Cheryl Bradshaw, who was among those waiting for the Feed The Children distribution, according to CNN.

“We are raising two grandkids, and we only have one income, so it’s a big, big blessing,” she added.

Ohio has one the highest unemployment rates in the country – 7.8 percent in December, compared to the nation’s rate of 7.6 percent.

Other Christian groups helping to provide food to American families include Operation Blessing International, which recently reported a 343 percent increase in partner applications from food pantries, and Saddleback Church in California, which challenged its congregants this month to fill 10,000 bags of groceries to help their neighbors in need.